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Advance and Pre-Award Costs for the 

Federal-State Partnership for Intercity Passenger Rail Program: 

Northeast Corridor Grants 

March 3, 2023

I. Summary

This policy allows certain Federal State Partnership for Intercity Passenger Rail (FSP) 

Northeast Corridor (NEC) (FSP-NEC) projects to incur costs prior to selection for and obligation 

of a grant award. Before obligation, FRA can approve a project sponsor’s request to incur costs at 

its own risk, and after obligation, FRA may approve previously incurred costs for inclusion in the

project scope of the grant. The majority of this policy document focuses on pre-obligation 

approvals of costs incurred before obligation. This policy does not change or affect FRA’s practice 

with respect to Pre-Award Costs for other FRA grant programs, including projects not on the NEC 

funded under the FSP program. 

This policy does not have the force and effect of law and is not meant to bind the public in any 

way. It is intended only to provide information to the public regarding the existing requirements 

under the law or agency policies. This policy is subject to review and periodic revision by FRA. 

II. Overview

a. Definitions Under This Policy

Advance Costs means costs incurred before grant selection and obligation. After obligation of an 

award, these costs may be approved as Pre-Award Costs.

Construction means activities in support of the Construction Lifecycle Stage as defined in FRA’s 

Guidance on Development and Implementation of Railroad Capital Projects (Guidance).1

Earliest Incurrence Date means the earliest date that a cost may be incurred and still be 

considered a Pre-Award Cost at or after grant obligation. The Earliest Incurrence Date for FSPNEC projects is the issuance date of the first NEC Project Inventory in which the project received 

an Anticipated Obligation.

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Equipment and Construction Materials Acquisition means the purchase of construction 

materials, equipment, railroad components, and rolling stock. 

Final Design means activities in support of the Final Design Lifecycle Stage as defined in the 

Guidance, other than Preliminary Real Property Investigation and Real Property Acquisition. 

NEPA Documentation means the activities that support completion of the environmental 

process required under the National Environmental Policy Act (NEPA), and related 

1 FRA Guidance on Development and Implementation of Railroad Capital Project | FRA (dot.gov)

2 For all other FRA projects, the Earliest Incurrence Date is the date FRA announces that the project is selected to 

receive a grant. 
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environmental laws. NEPA Documentation follows FRA’s determination of the appropriate 

NEPA class of action as defined in 23 CFR 771.115. 

Pre-Award Costs has the meaning described in 2 CFR 200.458. 

Preliminary Engineering has the meaning described in the Guidance. 

Preliminary Environmental Investigation means activities generally undertaken to inform 

preliminary design, determine the scope of environmental analysis, and assist FRA in making the 

determination of the potential class of action for the environmental review. Preliminary 

Environmental Investigation includes activities such as: resourcing mapping, identification of 

potential environmental impacts, localized geotechnical/other investigations for permitting 

purposes, archeology resources assessment or similar survey, and wetland surveys. 

Preliminary Real Property Investigation means activities in support of or in preparation for 

implementing real property acquisition. Preliminary Real Property Investigation includes activities 

such as: title searches, right-of-way cost estimates, acquisition plans and legal descriptions, public 

meetings or hearings, and initial appraisal work. Preliminary Real Property Investigation does 

NOT include offers, negotiations, or commitments to purchase real property. 

Real Property Acquisition means activities in support of the acquisition of interests in real 

property, other than Preliminary Real Property Investigation.

b. Relevant Legal Authority

FRA’s Office of Railroad Development (RRD) leads FRA’s review and approval of costs 

incurred before grant obligation if such costs are incurred pursuant to the negotiation and in 

anticipation of the grant agreement, and if such costs are necessary for efficient and timely 

performance of the scope of work consistent with the requirements of 2 CFR 200.458 (“Pre-Award 

Costs”). The legal authority for this notice in 2 CFR 200.458 states: 

Pre-award costs are those incurred prior to the effective date of the 

Federal award or subaward directly pursuant to the negotiation and in 

anticipation of the Federal award where such costs are necessary for 

efficient and timely performance of the scope of work. Such costs are 

allowable only to the extent that they would have been allowable if 

incurred after the date of the Federal award and only with the written 

approval of the Federal awarding agency. If charged to the award, these 

costs must be charged to the initial budget period of the award, unless 

otherwise specified by the Federal awarding agency or pass-through 

entity. 

For most programs, FRA only reimburses Pre-Award Costs after the time of grant obligation when 

such costs were incurred on or after the date of FRA’s selection of the project for award. In those 

instances, the Earliest Incurrence Date is the date of selection for award.
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c. Approval of Advance Cost and Pre-Award Cost Incurrence for Certain FSPNEC Projects. 

This policy allows certain FSP-NEC projects to incur costs prior to selection for award. 

Under this policy, FRA may approve costs incurred prior to a project’s selection for obligation 

consistent with 2 CFR 200.458 and the limitations described herein. This policy is only applicable

to FSP-NEC projects identified on the NEC Project Inventory (Inventory)3 with an Anticipated 

Obligation.4 The post-award approval of such costs for reimbursement is only available for 

eligible projects if the costs incurred were for activities within the scope of the project identified 

for the Inventory’s Anticipated Obligation and the project scope under the FSP-NEC grant. Under 

this policy, the Earliest Incurrence Date is on or after the date of the first Inventory in which the 

project received an Anticipated Obligation. 

Incurrence of Advance Costs consistent with this policy will not affect the likelihood, 

positively or negatively, of that project being selected for an FSP-NEC award. Project sponsors 

should describe Advance Costs and activities that they will include as project scope in their 

applications for FSP-NEC funding in response to the Notice of Funding Opportunity. 

 Any pre-obligation approval of Advance Cost incurrence is not a legal or implied 

commitment that the subject project will be selected for FRA assistance or that FRA will obligate 

Federal funds; incurrence of such costs are undertaken at the project sponsor’s risk. Furthermore, 

it is not a legal or implied commitment by FRA that activities undertaken by the project sponsor 

will be eligible for inclusion in the project. Such approval of Advance Cost incurrence is not an 

approval of the costs themselves, but rather an approval for the project sponsor to incur them. To 

be included as project scope and eligible for reimbursement or counted towards non-Federal match

of a grant, such costs must be consistent with the terms of the grant agreement, FRA procedural 

requirements, and applicable Federal law. Advance Cost incurrence enables expeditious project 

implementation and advancement, but will not enable the avoidance of oversight that would have 

been in place post-selection.

As described below, the process for appropriately incurring Advance Costs depends on the types 

of activities that a project sponsor intends to perform. 

d. Process

i. Automatic Approval of Advance Cost Incurrence

Project sponsors may incur Advance Costs for Preliminary Engineering, Preliminary 

Environmental Investigation, and Preliminary Real Property Investigation. FRA has concluded 

that costs associated with these activities categorically meet the standards for FRA to approve PreAward Costs under 2 CFR 200.458 after obligation, if selected and obligated, and therefore may 

be progressed under this policy without additional FRA’s written approval. Project sponsors 

3 NEC Inventory | FRA (dot.gov)

4 Projects listed with an “Anticipated Obligation,” including Gateway: Hudson Tunnel Project, are projects to which 

FRA most reasonably anticipates making an award within the inventory period. Anticipated Obligations are based 

on FRA’s understanding of the total amount of funding available for projects in that Inventory period. 
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should still provide RRD with a written notice of the incurrence of or intent to incur costs prior to 

a project’s selection for award of Federal funds (“Written Notice”), identifying the activities the 

project sponsor intends to progress. Project sponsors should submit a Written Notice as soon as 

feasible after deciding to incur such costs. While RRD will not provide a formal response to the 

Written Notice, RRD will review the information provided and the project sponsor will coordinate 

with FRA, as appropriate. See Appendix I below. The nature and extent of oversight coordination 

will vary depending on the project and the nature of the activity. RRD will exercise oversight

through pre-selection coordination, including by communicating to the project sponsor concerns 

regarding the likelihood of reimbursement or eligibility for project match or project selection as 

they arise. 

ii. Discretionary Approval of Advance Cost Incurrence

For Advance Costs associated with NEPA Documentation, Final Design, Real Property 

Acquisition and Equipment and Construction Materials Acquisition, and Construction activities, 

RRD will conduct a project-specific review. Project sponsors should provide RRD with a written 

request regarding the incurrence of Advance Costs, identifying the activities for which the project 

sponsor has incurred or intends to incur costs (“Written Request”). The Written Request should 

include: (1) a description of the items or activities for which Advance Costs will be incurred; (2) 

the amount to be incurred; and (3) a justification for advancing the identified activities under 2 

CFR 200.458, including an explanation of how incurring the costs before grant obligation is

necessary for the efficient and timely performance of the scope of work. FRA may deny approvals 

to project sponsors that do not follow these steps. 

After reviewing the Written Request for Advance Cost incurrence, RRD may, at its 

discretion, approve the incurrence of Advance Costs for these activities. The nature of FRA’s

response will vary, and it may convey an approval, disapproval, or request for additional 

information. Additionally, FRA will exercise oversight through pre-selection coordination, 

including communicating concerns to the project sponsor regarding the likelihood of 

reimbursement or eligibility for project match or project selection as they arise.

III. Content of Written Notices and Written Requests 

a. Written Notice for Preliminary Engineering, Preliminary Environmental 

Investigation, and Preliminary Real Property Investigation Activity Costs. 

Project sponsors should submit a Written Notice to RRD at FRA-Grants@dot.gov

outlining the scope of Advance Costs for activities to be undertaken in support of the project at the 

task level. Project sponsors should title the Written Notice according to the following convention 

“Advance Cost Incurrence Written Notice - Project Title”. These tasks can be approximate and 

may change, but should be consistent with FRA’s template statement of work and reflect the bestavailable information at the time of submission. The Written Notice for costs incurred before 

obligation should include: 

1. Project description and description of activities to be undertaken; 

2. Advance Cost incurrence estimate by Federal and non-Federal share; 
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3. Proposed date for incurrence of the Advance Costs, which should not pre-date the issuance

of the Inventory in which the project has an Anticipated Obligation; 

4. Coordination to date and plan for future coordination with involved parties (e.g., operators, 

local government authorities, potential cost sharing partners, right-of-way owners, and other 

interested parties); 

5. Ownership interest in property necessary for the project now, and anticipated ownership 

post construction; 

6. Anticipated operation and ownership agreements and partners; and 

7. Acknowledgment that the Advance Costs are in support of activities eligible for incurrence 

upon a Written Notice, and that Advance Costs incurred for future work in support of later 

project lifecycle stages may require a separate Written Request and will not be undertaken 

without FRA’s express notice to proceed. 

b. Written Request for NEPA Documentation, Real Property Acquisition and 

Equipment and Construction Materials Acquisition, Final Design, and 

Construction Activity Costs. 

Project sponsors should submit a Written Request to RRD at FRA-Grants@dot.gov

outlining the scope of Advance Costs for activities to be undertaken in support of the project at the 

task level and requesting an FRA response. Project sponsors should title the Written Request 

according to the following convention “Advance Cost Incurrence Written Request - Project Title”. 

These tasks can be approximate and may change, but should be consistent with FRA’s template 

statement of work and reflect the best-available information at the time of submission. The Written 

Request should contain a comprehensive package of information documenting completion of the 

necessary prerequisites to advance to the pre-award activities including, at a minimum: 

1. Project description and description of the activities to be undertaken during the period

before selections and/or awards. 

2. Cost Information:

 Estimate of Advance Costs to be incurred, showing Federal and non-Federal 

share;

 Project cost estimate developed for the project materials and labor; 

 Proposed date for incurrence of the Advance Costs, which should not pre-date 

the publication of the Inventory in which the project has an Anticipated 

Obligation. 

3. Project Development Information:

 A description of the preliminary engineering activities undertaken; 

 NEPA Decision Document, including any necessary reevaluations to confirm

the decision is still valid; 

 Evidence that all required permits and other authorizations necessary to initiate 

construction (if appropriate, based on activities being requested to progress) 

have been secured; 
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 Uniform Relocation Assistance and Real Property Acquisition Policy Act of 

1907 (Uniform Act) compliance information for any real property acquired for 

the project. 

4. Final Design: 

 If applicable, documentation showing FRA review and acceptance of final 

design drawings (plan sheets), specifications, studies, reports, plats, maps, and 

other engineering and surveying work products; 

 Plan Cover Sheet signed by FRA’s Office of Railroad Planning & Engineering

and senior executives with signatory authority from all appropriate railroad 

owners and operators; 

 Route and Aspect Chart (if necessary); 

 Staging Plan (if necessary). 

5. Construction Schedule 

6. Ownership and Operation: 

 Ownership interest in property necessary for the project now, and anticipated 

ownership post construction; 

 Anticipated operation and ownership agreements and partners; 

 Coordination to date and plan for future coordination with involved parties 

(e.g., operators, local government authorities, potential cost sharing partners, 

right-of-way owners and other interested parties). 

7. Acknowledgment that Advance Costs incurred for future work in support of later project 

lifecycle stages may require a separate Written Request and approval, and will not be 

undertaken without FRA’s express notice to proceed.

For NEPA Documentation Activities, also provide:

1. Information demonstrating sufficient Preliminary Environmental Investigation to 

inform FRA’s class of action determination; 

2. Demonstration that the project sponsor has the resources necessary to initiate and 

complete the NEPA Process; 

3. For projects anticipated to be covered by a Categorical Exclusion (CE), a completed

Draft CE worksheet; and 

4. For projects anticipated to require an Environmental Assessment or Environmental 

Impact Statement, a proposed schedule, draft public involvement/interagency 

coordination plan, and other investigatory documents and preliminary work 

sufficient to support the NEPA process and class of action determination. 

For Real Property Acquisition and Equipment and Construction Materials Acquisition, 

also provide:

1. Description of the necessity of material pre-purchase; 

2. Description of the plan for acquisition, storage, and maintenance of construction 

materials; 
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3. Attestation that real property acquisition meets the requirements of the Uniform 

Act and/or applicable state regulations and that the project sponsor has a Real 

Property Acquisition and Management Plan consistent with FRA Guidance; 

4. Unit costs, quantities, subtotals, and Federal/non-Federal shares of the costs of 

materials; and 

5. Plan for resale of materials should FRA later deem the purchase ineligible.

c. Documentation of Costs Incurred

The project sponsor should maintain documentation demonstrating that the Advance Costs 

are for a project that is later selected for a grant and must be included in the grant scope of work. 

The grant agreement will require the project sponsor to: 1) submit supporting documentation 

consistent with the requirements of the grant agreement, such as invoices, and 2) document, subject 

to FRA review and approval, that such costs are reasonable, allowable, and allocable to a grant 

agreement, and that they were incurred in conformance with the agreement. Upon approval of PreAward Costs after obligation, and review of supporting documentation, FRA will reimburse the 

project sponsor or allow the costs to be counted towards local match. 
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APPENDIX I 

Coordination 

For Advance Costs to be eligible for reimbursement or to count as match, project sponsors 

should coordinate with FRA. This coordination includes providing information to FRA 

demonstrating how the Advance Costs are for eligible activities that would fall within the Project's 

grant agreement scope of work if selected and enables FRA to exercise oversight of the activities. 

The nature and extent of oversight coordination will vary depending on the project and the nature 

of the activity. 

Within 10 days of submitting a Written Notice or Written Request, the project sponsor will 

contact FRA’s project manager, within FRA’s Office of Amtrak and Northeast Corridor Program 

Delivery (within RRD), to discuss and agree to a coordination approach. The following summarily 

describes anticipated coordination for different categories of activities. 

I. Coordination following a Written Notice 

In response to an Advance Cost Incurrence Written Notice, FRA’s Project Manager will 

communicate with the project sponsor including any concerns regarding the likelihood of 

reimbursement or project selection as they arise. FRA will require the following coordination, 

at a minimum, in response to a Written Notice. FRA may require further coordination.

 

A. Preliminary Engineering Pre-Award Activities:

1. Project sponsors may begin Preliminary Engineering work before coordination 

with FRA. 

2. FRA’s Project Manager will review the Written Notice and will conduct oversight 

consistent with 2 CFR Part 200 and FRA engineering policy and may, at its 

discretion, conduct such oversight in the same manner that it would conduct 

oversight of a project post award.

B. Preliminary Environmental Investigation 

1. Project sponsors may begin Preliminary Environmental Investigation work before 

coordination with FRA. 

2. FRA’s Project Manager will review the Written Notice and conduct oversight 

consistent with 2 CFR Part 200, 23 CFR Part 771, and FRA environmental policy, 

and may, at its discretion, conduct such oversight in the same manner that it

would conduct oversight of a project post award.

C. Preliminary Real Property Investigation 

1. Project sponsors may begin Preliminary Real Property Investigation work before 

coordination with FRA. 

2. FRA’s Project Manager will review the Written Notice and will conduct oversight 

consistent with 2 CFR Part 200, 23 CFR Part 771, and FRA environmental policy, 
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and may, at its discretion, conduct such oversight in the same manner that it

would conduct oversight of a project post award.

II. Coordination Following a Written Request

In response to Advance Cost Incurrence Written Requests, FRA’s Project Manager will 

approve, deny, or request more information. FRA expects the following coordination, at a 

minimum, in response to a Written Request. 

 

A. NEPA Documentation Pre-Award Activities

The project sponsor will contact FRA’s Office of Environmental Program Management to 

determine the appropriate class of action and to schedule a NEPA kick-off meeting before 

undertaking any formal actions under NEPA. If FRA approves of the project sponsor’s 

request to initiate the NEPA process, FRA will assign an environmental protection specialist 

and outline further required coordination. Consistent with 23 CFR 771.113, project sponsors 

may not advance property acquisition, Final Design, or Construction activities until the 

completion of the environmental review process. Project sponsors with questions regarding 

this limitation should contact FRA’s Office of Environmental Program Management. 

B. Real Property Acquisition and Equipment and Construction Materials Acquisition 

Written Request 

1. Project sponsors must coordinate with FRA’s Project Manager on Real Property 

Acquisition and Equipment and Construction Materials Acquisition to ensure 

compliance with relevant regulations and requirements as provided in FRA’s 

Guidance on Development and Implementation of Railroad Capital Projects. 

2. For projects that have not completed NEPA, project sponsors may only purchase 

railroad components or materials that can be used for other projects or resold. (See 

23 CFR 771.113(d).) 

3. For projects that have completed NEPA, project sponsors must submit a complete 

list of construction material to be acquired. 

C. Final Design Coordination 

FRA’s Project Manager will conduct oversight consistent with 2 CFR Part 200 and FRA 

policy, and may, at its discretion, conduct such oversight in the same manner and up to the 

same level that it would conduct oversight of a project post award. 

D. Construction Coordination 

FRA’s Project Manager will conduct oversight consistent with 2 CFR Part 200 and FRA 

policy, and may, at its discretion, conduct such oversight in the same manner and up to the 

same level that it would conduct oversight of a project post award.